New survey shows risks from crowded trades are rising

Investing.com -- HSBC revealed in a note Monday that its latest investor survey points to rising risks from crowded positioning, with sentiment improving across both public and private markets even as capital piles into a narrowing set of AI-related themes.

The ninth edition of the bank's proprietary Funding the Future Survey, carried out by Survation, captured the views of more than 200 global investors representing $2.32 trillion in assets, with fieldwork running from June 19 to July 17.

Data Scientist Shiva Joon said the survey shows sentiment and activity rising, "yet it is increasingly concentrated in fewer themes, fewer funds, and fewer mega-large deals."

HSBC noted that private market sentiment is positive but bifurcated, with 44% of venture and private equity investors expecting more activity next quarter and 64% over the next year.

Beneath the headline, a small number of outsized deals is said to be driving the rebound. Year-to-date global venture deal value is about $560 billion, dominated by AI megadeals, and HSBC highlighted that stripping out the five largest U.S. deals in the first quarter reduces the total by more than 70%.

Public investors were more upbeat, with 55% expecting a further equity rally next quarter after the strongest quarterly gains in six years.

On AI, HSBC said capex confidence holds, with 60% expecting spending to rise over the next six months and 90% viewing current spending as underutilized or about right.

But it flagged monetization as "the real test," with both camps converging on the same fear of disappointment if adoption fails to translate into revenue or margin delivery.

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